Council mulls tax increment financing for downtown

During a special city council meeting on Friday, the Mountain Home City Council began evaluating the use of Tax Increment Financing as a tool for local economic development.

Tax increment financing was passed as part of the Economic Development Act of 1988 and requires the formation of an Urban Renewal District. Many cities, including Jerome, Nampa, Moscow, Post Falls, Caldwell, Idaho Falls and Blackfoot have used the method to help finance improvements that attract or retain business and industrial development.

An example is the city of Twin Falls, where tax increment financing was used to assist with water, sewer and street improvements for the $22 million expansion of ConAgra/Lamb Weston, retaining 800 jobs. Building on that success, the Urban Renewal District used tax increment financing to recruit a California company, Seastrom Manufacturing, and to bring in Solo Cup's western manufacturing facility. Those added 200 new jobs to the economy.

The Urban Renewal District also made major improvements in the downtown and old warehouse district, including parking areas, decorative lighting, road reconstruction and providing the building that will house the Magic Valley Arts Council.

"It's an economic development tool with potential and one of the only means we have to fund downtown improvements," Mayor Dave Jett said. "But we're being cautious. We want to objectively assess the pros and cons and what those mean for this community. Every city's situation is unique."

Jett believes research and discussion regarding tax increment financing will be a high priority for the council over the next few weeks.

He noted that comments from the public, especially the business community, would be welcome and invited interested individuals to call him personally at city hall at 587-2104, or to contact any council member.